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MS’ new Web-based Office to counter Google

SEATTLE -- Microsoft Corp., seeking to counter a threat from Google Inc., plans to sell Web-based versions of its Office word processing and spreadsheet programs.

Microsoft will offer versions of Word, Excel, the PowerPoint slide program and OneNote note-taking software that operate in a Web browser, Senior Vice President Chris Capossela said in an interview.

The company introduced the Office programs at a conference Tuesday, where it also unveiled the next version of its Windows operating system.

The online programs aim to shore up Microsoft’s position after Google applications won deals at Sanmina-SCI Corp. and French auto-parts company Valeo SA. Microsoft clients like Procter & Gamble Co. have tried Google Apps lured by prospects of saving money and offering employees a smaller set of features accessible from any computer.

“There are certain cases where an on-demand version makes sense such as collaborative environments and people who move around a lot,” said Charles Di Bona, an analyst at Sanford C. Bernstein & Co. in New York. He expects Microsoft shares to outperform its peers and doesn’t own the stock himself. “It’s a smart thing to do ultimately. The bigger question is why did it take them so long to do it.”

Microsoft showed software developers at the conference in Los Angeles how users of the programs can create, edit and work together on documents and files. The demonstration, during a speech by Chief Software Architect Ray Ozzie, included one person using Microsoft’s Internet Explorer browser and another on the rival Firefox browser, working together on an Excel spreadsheet.

The world’s largest software maker also showed how browser- based Office applications work with mobile-phone versions.

While Microsoft’s Office 2007 is selling well, producing a 20 percent increase in sales for its Business Division last quarter, the company remains “very paranoid about all our competitors,” Capossela said.

The ability to use Office across personal computers, inside browsers and on mobile phones will give customers greater flexibility, Capossela said.

“Google isn’t going to match it,” he said. “IBM isn’t going to match it. OpenOffice isn’t going to match it.”

The browser versions, which will also work with Apple Inc.’s Safari, will probably cost less than traditional Office and have fewer features, Capossela said. Customers can go to officelive.com to participate in a private preview available later this year.

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 MS’ new Web-based Office to counter Google 
Ray Ozzie, chief software architect at Microsoft Corp., speaks during the Microsoft Professional Developers Conference in Los Angeles, California, U.S., on Tuesday. Ozzie said Google Inc. will need to learn how to work with other companies if it wants to compete with Microsoft’s Internet-based business services. (Bloomberg News)

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